Oil Surges After US Inventories Dwindle Unexpectedly

Prices for crude oil soared during Thursday’s trading session due to the unexpected slump of US crude oil inventories. The Energy Information Administration reported about a drop by 14.5 million last week, which was a total surprise to experts who were counting on an increase. Earlier this week, a report from the American Petroleum Institute showed a decrease of stockpiles by 12.1 million barrels. Reserves in Cushing, Oklahoma, the major delivery point for NYMEX crude, fell by 434,000.

Adding to the upward momentum of oil was China’s trade data that showed an increase of nation’s crude oil imports. Yet market analysts are skeptical about bullish prospects for crude. In particular, many of them believe that the slump of US stockpiles was just a temporary event as ships delayed offloading cargoes due to tropical storm. If that is the case, then inventories are likely to swell next week.

Futures for delivery of WTI crude oil in October climbed 4% to $47.32 per barrel as of 21:15 GMT on NYMEX today. November Brent crude oil advanced 3.56% to $49.69 per barrel on ICE.

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